December 12, 2019
Our testimony on "Duty to Serve", The Condo Comeback in Florida, and more!
Reflecting on 2019 & looking forward to the New Year
by Julia Gordon, President of NCST

As we approach the end of the year, I want to offer sincere and heartfelt thanks NCST to those of you who work to improve communities and increase opportunities for families across the nation. We are grateful for your continued partnership and interest in NCST’s work.
In 2019, we’ve weathered both an executive transition and a rapidly changing REO market, and early next year, we will begin to transition Fannie Mae properties from REOMatch to their in-house platform. Despite these changes and challenges, we’ve remained organizationally strong as well as steadfast in our commitment to promoting strong neighborhood housing markets through reducing blight, facilitating single-family rehabilitation, and increasing opportunities for affordable homeownership.
Some highlights from our work in 2019 include the following:

  • Enabled our Community Buyers to acquire 1,356 REO properties to restore to productive use and added two new sellers to the REOMatch program.

  • Through NCST’s subsidiary CRC, which manages a portfolio of nonperforming mortgages, kept 43 homeowners in their homes through mortgage modification or settlement, and where foreclosure was the only option, transferred 62 homes to local partners for rehabilitation as affordable housing.

  • Shepherded an unusually large coalition of national and local housing groups, trade associations, and lenders advocating for the introduction of H.R. 3316, the Neighborhood Homes Investment Act, an innovative, single-family tax credit that fills the “value gap” in markets where acquisition and rehabilitation costs more than the fair market value of homes, helping to jumpstart languishing housing markets and increase the supply of properties to support affordable homeownership.

  • Submitted comments to HUD, FHFA, and bank regulators to provide input on how to make their rules work better for revitalizing neighborhoods. Topics included HUD’s note sales program and disparate impact rule, the Community Reinvestment Act, and Fannie Mae’s Duty to Serve plan.

  • After deploying more than $60 million in acquisition and rehab capital, NCST wound down the REO Capital Fund returned the full PRI investment to the Ford Foundation on time and without a single delinquency.

  • Raised awareness about the challenges facing local housing markets through speaking engagements at dozens of industry conferences and meetings, by participating on eight different advisory councils for lenders, trade associations, and think tanks, and being quoted by journalists in both print and radio.

  • Bid farewell to our former president Rob Grossinger upon his retirement, and transitioned to a new president.

  • Built out our executive team by welcoming Kris Siglin, formerly of the Housing Partnership Network, as our new Vice President of Policy and Partnerships, and increased our capacity by bringing on Mariah Cowsert as a communications and executive assistant.
Please let us know how we can best serve you, your programs, and your communities in the months and years ahead. We look forward to our continued partnership and to sharing news of many more NCST programmatic and policy initiatives coming in the new year.

Best wishes,
Julia Gordon
The Condo Comeback: a Florida Perspective
by Racquel Reddie, NCST

Many considered single-family condos toxic real estate during the height of the foreclosure crisis. In markets like South Florida, where condo units made up more than 50% of single family inventory, it became extremely challenging for a potential homebuyer to obtain any type of mortgage financing, including an FHA home loan. Mortgage originations for this property type came to a halt as banks were declaring condo financing too risky. Existing condo unit owners were walking away from their homes with lasting financial effects on HOAs and other unit owners, making it more and more difficult for condominiums to stabilize. 

Fast forward ten years, NCST continues to see about 65% of its South Florida REO inventory in condo property types. For some, condos are seen as one of the more affordable housing options, especially in markets where the median home price exceeds $250,000. According to the Miami Realtors’ (source: Miami, Broward and JTHS Detail Statistical Reports for October 2019), the median home price of single-family detached homes was $365,000 and 362,000 in Miami-Dade and Broward counties respectively. For condo/townhomes the median home price was $247,000 and $168,000 respectively.

With the cost of housing going up in these markets, it appears that the timing may be right for lenders to dip their toes into financing condo units again. FHA’s new comprehensive policy revisions, issued this past August, include the ability to approve individual units or “spot approvals” in non-approved condo projects. While there are some limitations, this revision will allow individual units to receive spot approvals without a lender having to worry about a full condominium project approval. The details of this announcement can be found here:

One NCST buyer leading the way on being able to finance condos again is Real Estate, Education and Community Housing, Inc. (REACH) a Florida based nonprofit organization that has developed a unique partnership with Bank United to specifically address the availability of mortgage financing for condo property types. This partnership allows REACH to originate condo loans with a take out by Bank United for warrantable and non-warrantable existing condominiums throughout the state of Florida. This program is an exciting example of what is being done to create additional financing opportunities for these affordable property types.  
REAL ESTATE, EDUCATION AND COMMUNITY HOUSING, INC. is a Florida 501(c)(3) not for profit charitable organization, H.U.D. approved Foreclosure and Housing Counseling Agency and an affiliate of HomeFree-USA.
NCST testifies before Federal Housing Finance Agency about "Duty to Serve"
by Kris Siglin, NCST

Since 2007, Fannie Mae and Freddie Mac have had a legal obligation to serve parts of the housing market that have historically had difficulty attracting capital: rural areas, manufactured housing and affordable housing preservation. The responsibilities are known at “Duty to Serve” and they are enforced by the Federal Housing Finance Agency. In large part based on recommendations made by NCST, FHFA designated “neighborhood stabilization” as an activity that could be included in Duty to Serve efforts, and Fannie Mae chose to include that activity in their first Duty to Serve Plan.

FHFA is now gathering information for the next round of Duty to Serve planning, which will commence next year. As part of that effort, the agency held a “listening session” for stakeholders to testify about Fannie and Freddie’s efforts to serve these markets. Kris Siglin from NCST testified about Fannie Mae’s neighborhood stabilization activities. Here is an excerpt from the NCST testimony:

“Events since 2008 have demonstrated exactly why there should be public obligations for the Enterprises in exchange for their government backing. Congress chose priorities for Duty to Serve that have been perennial challenges in the affordable housing space: rural areas, manufactured housing and affordable housing preservation. These areas are in the statute because it has been difficult to deploy capital to support them, and Congress wanted the scale and market sophistication of the Enterprises brought to bear to improve our system. As the Enterprises continue into their second decade of government conservatorship the logic of Duty to Serve remains: there should be public benefits in exchange for the Enterprises’ government backstop.”

For NCST’s full statement, click here.  

For more information on Duty to Serve, click here .   

New Cosponsors for Neighborhood Homes Investment Act

NCST is working with a diverse coalition that ranges from the National Association of Realtors to Habitat for Humanity to support legislation that will make it easier to develop and renovate single family homes in languishing real estate markets. H.R. 3316, the Neighborhood Homes Investment Act, creates a federal tax credit to fill the “valuation gap” - when total development costs are higher than the home can be sold for – that deters rehabilitation and new construction. The tax credit will be allocated by state housing finance agencies and can only be used in census tracts with lower home prices and resident incomes. Representative Brian Higgins (D-NY) and Representative Mike Kelly (R-PA) are the lead sponsors of the legislation. We are pursuing a strategy to obtain additional cosponsors from both parties. Recent additional cosponsors include Representatives Marcy Kaptur (D-OH), Dan Kildee (D-MI), Darin LaHood (R-IL), Fred Upton (R-MI), Antonio Delgado (D-NY), Jackie Walorski (R-IN), and John Larson (D-CT). [j1]   If your Member of Congress is on this list, please thank them.

Click here for more information on the Neighborhood Homes Investment Act. 

Kris Siglin serves as NCST's Vice President of Policy and Partnerships.
Industry News
Fannie Mae and Freddie Mac Curb Some Loans as Regulators Reins in Risk*
*Julia Gordon quoted in article

Published by The Wall Street Journal |

Federal Regulators Issue Joint Statement on the Use of Alternative Data in Credit Underwriting

Published by Office of the Comptroller of the Currency | 
How Housing Becomes a Home: Why Cultural Supports Matter

Published by Non-Profit Quarterly |

Here are the 2020 presidential candidates' plans for affordable housing

Published by Housing Wire |

The housing crash was an opportunity for America. Obama blew it. (Opinion)*
*Julia Gordon quoted in article

Published by Detroit Free Press |
Staff, Phone or Email Changes?
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About NCST: The National Community Stabilization Trust (NCST) is a non-profit organization that works to restore vacant and abandoned properties to productive use and protect neighborhoods from blight. Our programs facilitate the rehabilitation of vacant but structurally sound homes, enable safe, targeted demolition when necessary, and support creative and productive re-use of vacant land.